Cummins Industries’ second-quarter profit grew 56 percent to $220 million, or $4.38 per share, up from $141 million, or $2.83 per share in the same period last year, the Columbus, Ind.-based engine manufacturer announced last week. Cummins’ second-quarter sales of $2.84 billion were a 14-percent increase from $2.49 billion in Q205.
Second-quarter net income includes $28 million, or 55 cents a share, for the favorable resolution of tax audits related to previous years. Without the tax benefit, Cummins’ net earnings grew 36 percent year over year.
“We had a terrific second quarter and remain on pace for a record 2006,” said Cummins chairman and CEO Tim Solso. “Our markets are strong around most of the world, we are winning new business and we continue to serve our customers well.” Solso added that the company reduced debt significantly.
EBITDA increased 38 percent year over year to $325 million, or 11 percent of sales, compared to $235 million during the same period last year. Gross margin increased to 23.6 percent, up from 22.1 percent in last year’s second quarter. Year-to-date cash flow from operations is running $200 million ahead of the same period last year.
Cummins also announced this week that it has reached agreement with a major automotive manufacturer to produce and market a light-duty diesel engine that will be used in a variety of automotive applications, including standard pickup trucks and sport utility vehicles.
In the power generation segment, sales rose 21 percent year over year to $598 million, with sales of commercial generator sets rising 27 percent.